Economic review

Regular readers of this newsletter will be aware that TMJ hosted a talk by Dr Cees Bruggemans this week past. The sub-topic: “A break in the clouds?” This suggests his take on our local economy is that we have reached an inflection point for the better and that a downgrade to junk status will not do us that much harm. He says that the latter has been priced into the system already. One hopes that he’s right!

Statistics on our economy is good and bad (mostly). WesBank predicts a total decline of 12% in new vehicle sales for this year. Not good.

The pace of spending in South Africa’s economy last year has decelerated to 2009 levels.

At the same time, the BankservAfica economic transactions index showed a month-on-month increase of 2.4%. Will this turn out to be an outlier?

Under the influence of doomsayers we tend to want to see GDP growth of 5% and more on the understanding that if we do not so grow, poverty will not be alleviated and so on. Warren Buffet says that a sustained modest 2% per year will, in a single generation of 25 years, lead to a 34% gain in the real GDP per person. Compound growth and keeping up momentum is what counts.

Business review

In an open letter to our SARS DG, Basson (again?) made public a series of alleged corruption scandals which Moyane is said not to have picked up on. One wonders whether these are true and whether this will prove to be his undoing?

Can one sidestep the new BEE codes by splitting one’s business into two smaller units? Possibly – if there is a good commercial reason for having done so and your timing is good. Be aware though that an intentional circumvention of BEE responsibilities carries a fine or imprisonment for 10 years or both.

To matters less serious:

Tiddle-do: Boeing has developed a self-cleaning toilet seat – not quite. The idea is to wash the area with ultraviolet light to kill germs. The wet floor will stay.

You will shortly be able to buy Barbie dolls in 3 different body shapes: tall, curvy and petite. As part of the deal will be a variety of skin tones, hair colours and hairstyles. Young girls might be unfortunately influenced by unnatural and unattainable proportions… with a resultant negative message about one’s own body image. J

Students have invented anti-radiation shorts to protect one’s crown jewels against radiation pulses of mobile devices – woven from silver wire! Would this be a silver lining or a silver platter?

Last week I sounded off on leadership and what it is not. A great example of a failed leader is Nummawan – and you can see the effect of this destroying the ANC. His own interest appears to drive him; if this is so, why does this offend us ? Is it the cost of Nkandla? Probably not. Is your boss a cold-hearted sob? Do you never see him? Does he only ever send you motivational e-mails? Does he have your back? Do you feel safe/good about working? Send him a copy of this (anonymously!): https://www.youtube.com/watch?v=ReRcHdeUG9Y

Also try: http://www.nytimes.com/2016/02/28/magazine/what-google-learned-from-its-quest-to-build-the-perfect-team.html?smprod=nytcore-iphone&smid=nytcore-iphone-share&_r=2

Property review

Our Building Industry Confidence Index published by the BER has dropped to a level of 39 points in the 1st quarter of this year (50 represents neutrality). This represents the lowest level in 3 years. Only the main/large contractors showed an improvement, with that segment of the Index standing at 43 points.

Generally speaking, smaller houses tend to increase in value even when the value of a higher priced properties go down: the reason being that there is more demand at the bottom end of the market. The ABSA house price index has shown a marginal decline in the value of small and medium houses. It is said that on average the real house price growth would slow down to about 5% this year – in other words, less than inflation.

A bitter harvest? One suspects that the political pressure coming from the left i.e. read EFF, has led to the identification of satisfying “land the hunger” in a bid to reduce poverty, inequality and unemployment. Given that the agricultural sector contributes only about 2 ½% to GDP and 5% employment, one wonders whether this is going to be an effective strategy. As we speak, Zimbabwe is on the cusp of compensating expropriated farmers, under pressure from, one suspects, the IMF. Most probably much will depend on how this is implemented. One must also ask whether the sum spent satisfying land hunger would not produce higher returns elsewhere. A case in point is subsidies paid to our motor manufacturing industry which cost more per job than the sum received by the relevant employee.

Under pressure from the Competition Commission, Discovery has launched a ranking system for private hospitals. However, it has yet to publish data on clinical outcomes. In the UK, the National Health Service publishes details of consultant’s mortality rates and indicates whether they are within an acceptable range. Is this happens for lawyers we might be all out of business!

Practice review

Professional news is generally quite slim. This has been a busy week:

This week past a hearing into the unethical practices around emolument attachment orders a.k.a. garnishee orders, kicked off in the Constitutional Court. The nub of the issue is whether a garnishee order should be issued by a clerk with no judicial oversight.

On a lighter note, peeing in Durban streets now carries a R40k fine. Other prohibited practices are being drunk, begging, damaging trees or hanging washing in a public place. Surely necessary but, given the parlous state of public facilities in that city, one wonders whether a defence of sudden emergency or something akin to that would work? Locking up beggars?

A Biz community article (http://www.bizcommunity.com/Article/196/548/141905.html) deals with the joinder of old and new employers in an action in terms of section 197 of the Labour Relations Act. Essentially, an employee should join both at CCMA or Labour Court level before an order is handed down. If this is not done, the failure is regarded as a waiver of rights against that employer. Worse a look.

Some 8 years ago Judge Hlope was accused of trying to influence Constitutional Court justices. The complaint degenerated into nothingness on the back of delays, intervening litigation and so on. A recent SCA judgement has cleared the way for the misconduct tribunal to go ahead. One wonders whether this will be heard before that gentleman’s retirement?

Last week I had suggested that the historical rates judgement [section 118 (5)] probably did not apply to residential homes. For the record, Allen West does not agree.

New deeds registration taxes will commence on April 1: http://www.sabinetlaw.co.za/land-reform/articles/deeds-registration-fees-adjusted

Cases

Lease granted by deregistered company

At the time of the conclusion of a lease, the owner of the property let, had been deregistered as company. Deregistration puts an end to the existence of a corporate entity and, as no steps had been taken to restore that company to the register of close corporations, the contract that it had entered into during the period of its deregistration, was invalid.

Anva Props [2016] JOL 35186 (WCC)

May an employer exclude from its workplace, by way of a lock-out, members of a trade union that was not a party to a Bargaining Council where a dispute arose?

The purpose of a lock-out in terms of section 213 is to compel employees, whose trade union is party to certain negotiations, to accede to an employer’s demand. A lock-out can be lawful only if it is pursuant to a demand. Resultantly, an employer is not entitled to resort to a lock-out if it has not yet made a demand to those employees who are excluded from the employer’s workplace. No industrial action can be undertaken until there has been an attempt at conciliation. In this case the union that complained was not a party to the dispute by reason of it not having been a party to the Bargaining Counsel within which this particular dispute arose. As a result such a lockout cannot be allowed.

Transport and Allied Workers Union v PUTCO CCT 94/15

Execution sales and outstanding rates

Very often an execution sale, as happened there, takes place reflecting a nil estimate of outstanding municipal rates. Only once the property is sold the conveyancers will obtain the figures and will advise the purchaser thereof. An interesting aside that came out of this is that a contract concluded as a result of a sale in execution can only be cancelled by court order. In any event, given the financial implications of section 118 of the Municipal Systems Act and the indemnity that the sheriff enjoys, the court cancelled the contract at hand.

Is it necessary for Parliament to publish all statutes in all official languages? No.

Lourens SCA case 20825/14

Quotables

What luck for rulers that men do not think.

Adolf Hitler

A leader is a dealer in hope.

Napoleon Bonaparte

Comment

Rhodes Must Fall: It has been a year since faeces were flung at the Rhodes statue on the UCT campus. “It was a calculated decision myself and professors W Kasibe, B Zono and Z Mcinzima came to after various discussions about the statue (The flinging activist). One wonders whether UCT felt that such advice by its own employees was fair comment? Is

“Representative democracy turns on the illusion that citizens understand what their politicians are doing and how well they are doing it. This mirage was once sustained by influential intermediary institutions – the news media and political parties – and by grand narratives that together made the world comprehensible.” The rise of one such as Donald Trump is indicative of the confusion alarmed citizens are prone to.

Foot-in-mouth syndrome: Closer to home, Thabo Mbeki seems intent on returning to the HIV/AIDS argument for which you will probably be remembered above all else. Whatever one says of him, he had a statesmanlike demeanour which far eclipses the bearing of our current incumbent and it is a pity that he cannot put this dreadful miscalculation behind him

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